In a shameful failure to challenge the Trump administration’s cynical plan to privatise Medicare, the publicly-funded federal health insurance program for people sixty-five or older, Joe Biden’s administration must now take the blame for the damage that has been done.
Official figures now show private Medicare Advantage (MA) plans now account for a majority of the entire Medicare program, with, 30.19 million of the 59.82 million people with both Medicare Part A and Part B enrolled in a private plan as of January 2023.
The long running doctors’ campaign Physicians for a National Health Program (PNHP) have flagged up this grim milestone as the last remaining progressive sector of the US health system has been subordinated to the profiteering of the US medical insurance industry.
PNHP (which is celebrating 35 years of campaigning) has warned of the many problems with MA, which imposes intolerable restrictions on beneficiaries – from restricting them to narrow provider networks to requiring prior authorization prior to treatment and high out-of-pocket costs.
They have called on the Biden administration to terminate Medicare Advantage and end this indefensible “partnership” with commercial health insurers.
Under Traditional Medicare, the federal government pays directly for the health care of seniors and adults with disabilities. Beneficiaries generally pay monthly premiums and need to have paid a ‘deductible’ payment before insurance cover kicks in, but patients have access to a wide range of doctors and hospitals across the country. Many patients also choose to enrol in a supplemental “Medigap” plan to limit their out-of-pocket costs.
Under (MA), the government pays a third party (often a commercial insurance company) to “manage” patients’ care. While premiums tend to be lower than they are in Traditional Medicare, patients can face high out-of-pocket costs, much more restrictive networks and face the hassles of prior authorization.
By restricting care through pre-authorizations, referral requirements, and limited networks, insurers keep their costs lower than the provided maximum payment from Medicare, and are allowed to keep a portion of the difference as profit.
Denying care also drives sicker beneficiaries to leave the program, which, when combined with marketing that targets healthier individuals, leads to a lower-risk patient pool – and higher overall profits.
Many MA insurers have also been accused of “upcoding” patients with a variety of illnesses and conditions that may be exaggerated or even non-existent in order to get a higher risk score and thus bigger payments from Medicare.
To make matters worse, the outgoing Trump administration established a Direct Contracting system that made it possible for Medicare Advantage subscribers to wind up enrolled with for-profit insurance companies against their will.
Far from solving this problem, Biden’s team came up instead with a new, grotesquely misnamed ‘ACO-REACH’ program [Accountable Care Organization – Realizing Equity, Access, and Community Health]. It allows hospital-led managed care organizations to access the new Medicare privatization scheme, too – and inveigles patients to sign up, with little or no informed consent, to for-profit insurance corporations, on plans that benefit health care profiteers and create incentives to deny care.
Last year the biggest US health insurers turned over a staggering $1.25 trillion, with profits of $69.3bn. Yet they still describe every cent spent on patient care as “medical loss”. Biden’s team has helped boost the profits and limit the losses – at the expense of elderly patients.
- PNHP has more than 20,000 members and chapters across the United States, and argues for a universal, comprehensive ‘single-payer’ national health program.
- Next week, Sen. Bernie Sanders and Rep. Pramila Jayapal will introduce the newest versions of the Medicare for All Act in the U.S. House and Senate. PNHP are calling on ‘single-payer’ supporters in every state and every district to call their legislators and demand that they sign on to these important bills.
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